Energy and Environment

IEA Debate: Should classical liberals accept “Net Zero” as a given?


YES – says Matthew Lesh

“But actually, he thought as he re-adjusted the Ministry of Plenty’s figures, it was not even forgery”, Winston muses in George Orwell’s Nineteen Eighty-Four. “It was merely the substitution of one piece of nonsense for another. Most of the material that you were dealing with had no connection with anything in the real world.”

I don’t much like targets. Government goal setting always reminds me of a Soviet five year plan. “Comrade, the quota for steel and wheat has been exceeded for the 8th year in a row”, the starving peasant is told, knowing reality never quite reaches up to what politicians claim.

‘Net Zero by 2050’ is ridiculous. It was legislated in the dying days of the May government after a Swedish schoolgirl descended like a street preacher to declare the end is neigh – albeit after being discussed in policy circles for several years. The Government that put it into law has already collapsed and not many of the MPs who voted on it – probably none – will still be in Parliament by 2050.

Net zero is also arbitrary – why not 2049 or 2051? How about 2025, as proposed by Extinction Rebellion? Reducing carbon emissions is necessary to keep climate change to around 1.5°C to 2.0°C. But we do not yet know whether that will be unachievable without plunging much of humanity back into abject poverty or whether the likes of battery tech, fusion energy and carbon sequestration will make it ridiculously easy.

Yet here we are. The target is in law. So what’s next?

For many classical liberals the instinct is to criticise. But just because we can does not make a focus on the target the right strategy. A focus on opposing ‘net zero’ is not only a waste of time but actively counterproductive.

This is not an argument for an unthinkingly accepting the Government’s environmental policies. Quite the opposite. We should be fast to critique the abhorrent use of taxpayer money on rent-seeking projects under the guise of environmentalism, the use of draconian regulations like banning plastic straws, and ill-designed interventions that have pushed up the cost of electricity.

But these policies are not the same as ‘net zero by 2050’. They may be justified by the goal, but these ideas both come separately and many of them predate the target. ‘Net zero by 2050’ is, by itself, quite meaningless. All it does is create a central focus, which is perhaps necessary for international agreement-making, but it does not make anything else happen by itself. The fight is no longer about ‘net zero,’ but rather, the policy approach to reducing carbon emissions.

Opposing net zero is reminiscent of those final Japanese soldiers who continued fighting World War II for decades on various Pacific islands. We can perhaps excuse their dedication on the basis that they simply were not adequately informed that the war had ended. There is no such excuse for foes of net zero. We know the battle against acting on climate change has been thoroughly lost.

The polling is stark: most people believe the climate is warming due to human activity (72%) and that concerns have not been exaggerated (68%). Though support for action is weaker when people feel a personal cost, the question about ‘net zero’ in itself is not particularly controversial. Almost 4 in 5 (78%) strongly or somewhat support the net zero target. Net zero also has strong support across the major political parties. Even net zero’s most stringent opponents cannot conclude that there’s a realistic chance of the target being repealed.

If we can already see that it is futile to continue the fight then why bother?

The best argument in favour of opposing net zero is that it is necessary to criticise the associated policies that are lowering quality of life. But that ignores the high opportunity cost – the time we could spend doing other tasks. In the case of Imperial Japan’s last soldiers, it is worth remembering the almost three decades (29 years, 3 months and 16 days) spent by private Teruo Nakamura on an Indonesian island unbeknownst that Japan had surrendered. That was time he could have spent living in a house, raising a family and contributing to society.

Similarly, classical liberals who focus on ‘net zero’ as a target rather than a policy challenge are wasting their time fighting a lost war and could instead promote better ideas. Classical liberals have the solutions to climate change in our policy toolkit. A liberal market system is well-equipped to tackle climate change by removing barriers to innovation and, with a carbon tax, the price mechanism. The UK’s Carbon Price Floor, which taxes electricity generation in proportion to carbon content, an effective carbon price, has already proven immensely effective in reducing emissions.

Markets, when properly set loose, are immensely powerful in finding solutions to problems in a bottom-up manner that does not require state direction. We can provide the optimistic case, responding to absurd claims about total planetary collapse, while highlighting the least costly and most effective ways to address climate change.

It is much more difficult to deliver that positive case while opposing the target. Opposing net zero risks being labelled a ‘climate denialist,’ whether intended or not. This means a loss of legitimacy to make the necessary arguments for a market-oriented response to climate change. This effectively surrenders the policy debate, emboldening the interventionist side, and not being invited to the decisionmaking table.

We should also consider how our views on ‘net zero’ can impact the broader support for a market system and our other policy ideas. Younger people are ‘sad, afraid and anxious’ about climate change. A failure to show we are taking the issue seriously risks alienating the next generation from the free market system. If they (wrongly) perceive socialism to be necessary to tackle climate change – and polling shows that most of them do – we risk creating even more young socialists.

We should demonstrate the opposite: climate change gives us a perfect opportunity to show the sheer power of the market to do good. If we use market signals to solve the problem, maybe they won’t be so maligned in other parts of the economy.

Classical liberals should treat climate change as a severe yet solvable issue, not the end of the world. But we can only do that by focusing on the policy. We should not waste our time fighting the last battle. It’s time to win the war with market environmentalist policies.

________

NO – says Andy Mayer

At heart, the notion classical liberals should accept anything as ‘a given’ is a nonstarter, given that we believe in the right of the individual to dissent, however misguided. We are with Locke not Hobbes on questions of toleration. We do not believe that individuals must espouse a state religion outwardly whatever they believe inwardly. We do believe that the legitimacy of the state comes from consent not absolute authority.

Both aspects are relevant to the modern state religion of Net Zero, and its defining belief that the central purpose of Government is to drive us all to that outcome, with or without our consent.

The ideology of Net Zero is somewhat different to the dry-as-dust scientific viewpoint that to halt man made global warming, greenhouse gas (GHG) emissions (principally CO2) from human activities  must be equal to or lower than those sequestered, either in biomass or storage. The fundamental science is uncontroversial, and can be demonstrated in a lab, with debates today focused on climate sensitivity,  and how warming manifests itself through extreme weather, flooding, micro-climates, biodiversity, and activities like agriculture.

The ideological version, ‘NetZeeism’ perhaps, holds that the moment of Net Zero must be achieved and sustained by a certain date, usually in 2050, to ensure global warming of no more than 1.5-2oC above pre-industrial levels. This temporal-temperature absolutism is not a scientific position, but one rooted in presenting a complex and uncertain problem as a simple existential threat. One to which Government action is required, generally of a highly interventionist and authoritarian nature, in order to avoid “systemic environmental collapse”. That is not a given.

Scientifically and economically, whether we achieve Net Zero by 2050, 2100 or another date, whether temperatures rise by 1, 2, 3 degrees or more, the response will not be to do nothing, but dynamic. We have been adapting to climate change throughout our history, whether building sea walls to fend off rising sea levels or migrating from environments turned hostile.

The ‘do it now or doom’ narrative of NetZeeism, well-illustrated in the recent Hollywood movie Don’t Look Up is palpable nonsense. Humanity is remarkably good at coping with change, and inventing solutions in the face of adversity. We don’t need a central plan for heat pumps, let alone one conceived in an analogy to firing a missile at a meteorite.

Liberal free market environmentalists can then take a stance of climate optimism, confident in our ability to solve these challenges. Just as in prior centuries we dealt with other claimed crises from Malthusian famines to more recent viral pandemics. On climate change, Atlantis is the fiction, the Netherlands (where they have been building effective flood barriers for centuries) the reality.

Classical liberals are also confident that, as with people, the freer the markets are, the better we are at solving problems like Net Zero. NetZeeism again is resolute that the opposite is true. The people cannot be trusted, markets don’t work, and we must be compelled to act to hit meaningless targets, regardless of the cost, regardless of the trade-offs with other social goods.

This isn’t even an environmentalist stance. An understanding of friction between social, environmental, and economic goals was built into the concept and definition of sustainable development from the earliest days of a movement. One best understood as a shared desire for a cleaner, greener world where each generation leaves to the next a planet in a better state than they found it in. It’s never been a game of moral absolutes, or confusing emissions of plant food with dark magic.

It has however been one in which the record of liberal free market economies, dedicated to raising prosperity and stimulating innovation through competition and choice have a better record than the alternatives. This is the fundamental point of the Kuznets curve. If we want to reduce the impact of developing economies on the environment, let them develop. That requires free exchange of goods services and ideas through free trade, not a global agreement on permitted technologies and compensation for past underdevelopment through aid.

A popular NetZee analogy for climate action conversely has been a war narrative. Excess emissions of CO2 are Hitler, and we must design a war economy, preferably outside democratic control through international alliances, to counter their threat to the Paris Agreement. Complete with nationalisation of strategic industries, internment of fossil fuels, rationing, and control of the media. It’s a terrible analogy, other than to note we won that particular war in part due to superior access to oil and other now-maligned energy sources.

The only remarkable thing about this illiberal madness is how deeply the groupthink has penetrated elite opinion, whether right or left. Such that every piece of evidence of its failure, from state insulation programmes to insecurity of supply and high prices, results in calls for fighting the war harder. Intervention has failed, we need more intervention. Parliament is too short-termist and accountable, we need more powers for the Committee on Climate Change.

This is how we end up with the British state part-nationalising a fertiliser plant in order to produce CO2 for the drinks industry, as a result of high energy prices caused by targets to reduce CO2. It’s how we end up importing fracked gas in order to justify a continued ban on fracking our own reserves.

Meanwhile the erratic path of technological change carries on being ploughed and tested through consumer choice. Across the world the cost of low carbon technologies are falling, new things are being tried and some will be gaming changing.  This would be happening a lot faster, at a lower cost, were Governments to confine themselves to nudging markets through consistent carbon pricing, and otherwise staying out of the way. Rather than regulating widgets and picking winners while jetting all over the place to lecture others about responsible behaviour.

Those are the fights worth having with the NetZees. Their ideology is not a given, their goals are wrong, their ideas are terrible, they’re lousy environmentalists, and they’re doing real harm, generally and to their own ends, now and every day they persist in believing their interventions are saving the world.

Liberal free market environmentalism works, we need to keep saying so.


2 thoughts on “IEA Debate: Should classical liberals accept “Net Zero” as a given?”

  1. Posted 16/02/2022 at 21:21 | Permalink

    I have to take issue with this from Dr Mayer
    The fundamental science is uncontroversial, and can be demonstrated in a lab
    That’s funny because I have never yet seen such a demonstration. If a link to one can be provided I would be grateful.
    The difficulty with the most common laboratory proofs is that they add CO2 to an enclosed space under lights. The climate greenhouse gas effect mainly operates without lights in an unenclosed space – it is not in the main an increase in daytime heating – it is majorly a reduction in night time cooling as a result of CO2 and other gases preventing infra red radiation escape. This leads to a small overall rise in world temperatures. Demonstrate that in a lab and you’ve nailed your point Dr Mayer. But I think you are talking about demonstrations with two containers, one being the control, one with CO2 added, and done under lights.
    The atmospheric greenhouse effect is real of course, but the demonstration is decidedly difficult.

    As to one of Mr Lesh’s main points – I don’t see how we should side with an intellectually inconsistent world view which says that with the current 420ppm CO2 there is a real and present climate emergency, and that there will not be if we maintain that. One of those assertions cannot be true.

  2. Posted 23/02/2022 at 15:26 | Permalink

    What would the contributors think to removing all and any subsidies, tax breaks or other financial support from governments for the fossil fuel supply chain? That would make one part of, and therefore on average the whole of, the market ‘freer’ while also allowing progress on reducing emissions.

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